2014 Index of Economic Freedom

Qatar

overall score71.2
world rank30
Rule of Law

Property Rights70.0

Freedom From Corruption72.4

Limited Government

Government Spending72.1

Fiscal Freedom99.9

Regulatory Efficiency

Business Freedom71.7

Labor Freedom70.0

Monetary Freedom81.2

Open Markets

Trade Freedom79.8

Investment Freedom45.0

Financial Freedom50.0

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Quick Facts
  • Population:
    • 1.8 million
  • GDP (PPP):
    • $187.9 billion
    • 6.6% growth
    • 13.1% 5-year compound annual growth
    • $102,211 per capita
  • Unemployment:
    • 0.5%
  • Inflation (CPI):
    • 1.9%
  • FDI Inflow:
    • $326.9 million
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Qatar’s economic freedom score is 71.2, making its economy the 30th freest in the 2014 Index. Its score is essentially unchanged from last year, with improvements in half of the 10 economic freedoms, including business freedom, labor freedom, and monetary freedom, offset by declines in the control of government spending and trade freedom. Qatar is ranked 3rd out of 15 countries in the Middle East/North Africa region, and its overall score is above the world average.

Qatar was first graded in the 1999 Index and since then has advanced its economic freedom score by over 9 points, reaching its second highest score ever in the 2014 Index. Scores for eight of the 10 categories of economic freedom have improved. Market openness, measured through trade freedom and financial freedom, has advanced significantly, and gains in business freedom, labor freedom, and monetary freedom have improved overall regulatory efficiency.

Deeper institutional reforms are needed to sustain high levels of economic growth and ensure long-term development. Systemic weaknesses linger in the enforcement of anti-corruption measures, although Qatar’s anti-corruption record remains much better than the world average.

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Background

Qatar has been ruled by the Al-Thani family since independence from Great Britain in 1971. Political reforms promised by current Sheikh Hamad bin Khalifa al-Thani have largely stalled. Qatar is endowed with 25 billion barrels of proven oil reserves and the world’s third-largest natural gas reserves. Oil and gas account for about 85 percent of export revenues and more than 50 percent of GDP. Qatar has permitted extensive foreign investment in its natural gas industry and in 2007 became the world’s largest exporter of liquefied natural gas. With one of the world’s highest per capita incomes and almost no poverty, Qatar has largely avoided the political instability that other Middle Eastern countries have suffered as a result of the “Arab Spring.”

Rule of LawView Methodology

Property Rights 70.0 Create a Graph using this measurement

Freedom From Corruption 72.4 Create a Graph using this measurement

Although critics continue to complain of a lack of transparency in government procurement, Qatar’s anti-corruption record is among the best in the Middle East. The rule of law has been solidly respected. A well-functioning legal framework is in place, but the judiciary is susceptible to political influence and can be bureaucratic. Foreigners are generally not allowed to own property.

Limited GovernmentView Methodology

Qatar has no individual income tax or corporate tax. There are no other major taxes apart from customs duties. The overall tax burden amounts to 2.9 percent of gross domestic income. Government is funded largely by oil revenues, and public expenditures are equal to 31 percent of GDP. Public debt amounts to less than 40 percent of the size of the economy.

Regulatory EfficiencyView Methodology

Launching a business takes eight procedures and slightly more than a week. However, despite some progress, completing licensing requirements continues to be relatively time-consuming. The labor force consists primarily of expatriate workers, and immigration and employment rules are relatively flexible. The government does not mandate a minimum wage.

Open MarketsView Methodology

Qatar’s average tariff rate is 5.1 percent. Government procurement policies favor domestic producers. With some exceptions, foreign investment levels are capped at 49 percent. The financial sector, in which the state continues to retain some ownership, has undergone modernization. The Qatar Financial Center, opened in 2005, has attracted major financial firms and rivals other regional financial hubs.

Country's Score Over Time

Bar Graph of Qatar Economic Freedom Scores Over a Time Period

Country Comparisons

Bar Graphs comparing Qatar to other economic country groups

Regional Ranking

rank country overall change
1Bahrain75.1-0.4
2United Arab Emirates71.40.3
3Qatar71.2-0.1
4Jordan69.2-1.2
5Israel68.41.5
6Oman67.4-0.7
7Kuwait62.3-0.8
8Saudi Arabia62.21.6
9Lebanon59.4-0.1
10Morocco58.3-1.3
11Tunisia57.30.3
12Yemen55.5-0.4
13Egypt52.9-1.9
14Algeria50.81.2
15Iran40.3-2.9


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